Ch1&2
Ch3
Ch4
Ch5
Ch6
100
Define Retailing
adds value to products and services sold to consumers
• Not always in stores
• May include lodging in a motel, home-delivered pizza
100
What are the benefits of shopping in a store?
• Touch and smell of products
• Personal service
• Risk reduction
• Immediate gratification
• Entertainment and social experience
• Cash payment
100
What are the stages of the buying process?
Need recognition
Information search
Evaluation of alternatives
Purchase merchandise or service
Postpurchase
100
Define Segmentation.
A group of customers whose needs will be satisfied by the same retail offering because they have similar needs and go through similar buying processes.
100
What are the different objectives of retailing?
Societal- make world better place to live, more difficult to measure
Personal- especially for small and independent businesses, self-gratification/status/respect
Financial- ROA, using profits is not accurate
200
What is Conscious Marketing?
• Recognition of the retailing firm’s greater purpose
• Consideration of stakeholders and their interdependence
• The presence of conscious leadership, creating a corporate
culture
• The understanding that decisions are ethically based
200
What are the benefits of Online Shopping?
• Deeper and broader selection
• More information for evaluating merchandise
• Personalization
• Live chats
• Expanded market presence
• Information to improve the shopping experience across channels
200
Define Cross-Shopping.
A pattern of buying both premium and low-priced merchandise or patronizing expensive, status-oriented retailers and price-oriented retailers.
200
What are the steps in a Retail Strategy?
Define business mission
SWOT analysis
Identify strategic opportunities
Evaluate strategic opportunities
Establish specifiv objectives and allocate resources
Develop retail mix
Evaluate performance and make adjustments
200
What is a retailer's main objective?
to achieve target return on sales
Consists of net profit margin (%) and asset turnover
300
Define assortment of merchandise
Depth!
The number of SKUs within a merchandise category
Ex: 2 series, 3 series, hybrid, M series, etc
(Can also apply to a specific category rather than entire store)
300
Define Showrooming
A practice in which customers visit stores to interact with a physical product and receive sales assistance, then purchase it through a less expensive channel, such as online.
Can be reduced by:
• Providing better customer service
• Offering unique relevant information based on customer data
• Promoting private-label merchandise
300
Define Conversion Rate.
Percentage of consumers who buy the product after reviewing it.
300
Define sustainable competitive advantage
A distinct competency of a retailer relative to its competitors that can be maintained over a considerable time period.
• Some advantages are sustainable
• Others are copied quickly by competitors
• Three keys to sustainable advantage:
Build strong relationships with customers
Build strong relationships with suppliers
Achieve efficient internal operations
300
Define Inventory Turnover
how many times, on average, inventory cycles through the store during a specific period of time
400
What are the different types of competition? Explain Each.
intertype competition - competition between retailers that sell similar merchandise using different formats, such as discount and department stores.
intratype competition - competition between the same type of retailers (e.g., Kroger versus Safeway).
400
Define Multichannel & Omnichannel
-Selling merchandise or services through more than one channel.
-
Coordinated multichannel retail offering that ensures a seamless customer experience across all the retailer’s channels.
– The customer journey is paramount
– A unified strategy across touch points will help create a
unique experience
– Data will provide firms’ feedback and opportunities
400
Define a consideration set and explain how to get into a consumers consideration set.
the set of alternatives the customer evaluates when making a choice of what retailer to patronize.
Increase beliefs about store’s performance
• Change customers’ importance weights
• Add a new benefit
• Fair trade
400
Describe Customer loyalty.
Enhanced through: unique merchandise, customer service, CRM programs (frequent shopper programs), building a retail community through social media
400
Define Gross Margin
The difference between the price the customer pays for merchandise and the cost of the merchandise (the price the retailer paid the supplier of the merchandise. Also called gross profit.
=Net sales - COGS
500
What is service retailing and What are potential problems that arise in a service retail environment?
Sell a service rather than merchandise
Intangible, simultaneous production and consumption
Ex: bank, university, airline, restaurant, spa, doctor
Potential problems: perishability, inconsistency of offerings to customers
500
Define E-Commerce, M-Commerce, and S-Commerce Retailing.
Electronic commerce
• Perceived risks in Internet shopping
Internet channels accessed through tablets, smartphones, or
other handheld devices. Also known as mobile marketing, mobile
commerce, or mobile retailing.
• Customers access retail sites from anywhere
• Location sensitive
• Biggest disadvantage is smaller viewing screen
• Some retailers design distinct websites and apps for
different devices
conducting purchase
transactions through social media sites
• Twitter, Pinterest, Instagram have “buy buttons”
500
Distinguish between Nominal, Limited, and Extended decision making.
Nominal - Not very important purchases, habitual items like toothpaste, consumer does not spend a long time deciding, low search effort
Limited - A purchase decision process involving a moderate amount of effort and time. Customers engage in this type of buying process when they have some prior experience with the product or service and their risk is moderate.
Extended - A buying process in which customers spend considerable time at each stage of the decision-making process because the decision is important and they have limited knowledge of alternatives.
500
What are the Growth Opportunity Strategies?
• Market Penetration:
• Attract new customers from current target market
• Get current customer to visit store more often or buy on each visit
• Opening more stores or extending store hours
• Market Expansion:
• Use existing retail format in new market segments
• Dunkin’ Donuts opened new stores outside traditional target market
• Chico’s acquired White House Black Market
• Retail Format Development:
• Develops a new retail format with a different retail mix for the same target market
• Diversification:
• Introduces a new retail format directed toward market segment not currently served by retailer, least opportunity to exploit an advantage
• Related diversification growth opportunity
• Unrelated diversification growth opportunity
• Vertical integration
500
What is the formula to calculate Return on Assets?
